If you’ve seen Die Hard 4.0, you’ll remember the ‘fire sale’ carried out by Timothy Olyphant’s cyberterrorist gang – a series of attacks designed to fracture the country’s digital infrastructure. Now, Britain’s banks are being urged to improve their security systems in a bid to counter increasingly sophisticated attacks from cyber criminals. And consumers are being advised to watch their own backs as well.

The Treasury has been expressing concerns at the growing threat from cyber attacks and the need for financial insitutions to fortify their defences. Along with the Bank of England, the City Regulator and government agencies, the Treasury is concerned that advances in cyber crime could lead to banks being targeted, which would have severe knock-on effects.

The “high degree of interconnectedness” within the financial system left it particularly vulnerable, the Financial Policy Committee added. Leaders of major institutions must ensure that “a concrete plan” is in place to protect against cyber attacks, it proposed.

Directors have now been given six months to submit plans that show how their institution’s security systems will be improved. The Bank of England must also analyse its own systems as part of the initiative.

Santander Voted “Weakest” for Online Security

It must be expected, then, that banks will continue to improve their online banking security for retail customers. Ahead of National Fraud Identity Prevention Week, a poll by Which? has identified the banks among the best and worst for online banking security.

But Santander was considered among the worst for online banking security, scoring just 47% in the poll as its logout function raised a number of concerns. Ironically, it was IT problems identified by Santander that led to it pulling out of a deal to buy 314 branches from the taxpayer-owned RBS last year. Santander said it was intending to address the security issues to restore confidence in its online systems.

National Fraud Identity Prevention Week

As part of National Fraud Identity Prevention Week, consumers are being advised to stay vigilant against security breaches and reduce the risk of identity fraud.

There were 123,589 recorded victims of identity fraud in 2012, with the average loss exceeding £1,000 per person. On average, it takes well over a year for someone to discover that they have become a victim, which leaves them severely compromised.

Fewer than 40% of us have a password or security feature in place to access all of our mobile devices. Even more worringly, almost a quarter of us admit that none of our mobile devices are protected.

Paul Wilson, professional hacker from BBC Three’s The Real Hustle, says that while it’s important not to walk around paranoid, it is best to stay alert and take reasonable precautions. This video (transcripted below) offers further advice on dealing with identity fraud.

Watch closely!

We’re living ever more of our lives online, and with the proliferation of internet connected portable devices, it’s easier and easier to stay connected. But consumers also need to be vigilant, with the growing risks posed by online fraudsters. ID fraud is a major trend in the 21st century. The National Fraud Authority estimates it cost the UK economy over £73 billion. Last year, CIFAS, the UK’s fraud prevention service, recorded over 123,000 victims of identity fraud in the UK.

Meanwhile, Experian victims-of-fraud team have investigated nearly 19,000 fraud incidents in the last 12 months, and found an increase of nearly a third compared to the same period last year.

Well, I’ve been the victim of ID fraud three times now over the past four years. But in the last two weeks, the most dramatic incident occurred, and that was bank and mobile phone at the same time. The first I knew was I received a postal statement from the bank telling me £6,000 had been transferred internally between my personal ISA and current account. Immediately, I rang the bank and closed down all my bank accounts, and there seemed to be a coordinated attempt to steal from me. And they succeeded, very cleverly. There wasn’t an awful lot I could do about it. It made me feel extremely vulnerable.

Nick Stone

In 2012, it took victims of ID fraud an average of 444 days to discover the crime, with an average loss of £1,100. But in addition to the financial cost and inconvenience, being a victim of ID fraud can also have a lasting negative effect on your credit rating.

The volume of personally traded information is rising rapidly. At Experian, we monitored over 35 million pieces of compromised and traded information last year, and that was three times as big as 2010, so it’s a growing problem.

Jayne Sankoh-Beacom, Head of Identity Products, Experian

You know, in terms of protecting our identity, the most common mistake we make is not to pay attention when we should, especially when we’re accessing something online or using an unknown source like a free wifi spot. We’re in a hurry; we’re in the middle of doing one thing before we do another; and we just make a simple mistake, and someone can take advantage of that. So the biggest enemy is our own inattention. I check everything, but then I look back and realise there were a few things I didn’t check. That can happen to anybody.

The truth is, that while these things are possible, they are still unlikely, and you shouldn’t walk around paranoid – you should enjoy the convenience of modern life. Just, take some precautions. If you become a more difficult target, people will move on to somebody else.

Paul Wilson, The Real Hustle

Staying safe online is very simple. The first thing that everybody should do is to make sure that they use different passwords for their different online accounts. It’s a really simple and easy thing to do. Secondly, make sure your mobile or tablet device is actually password protected. Every device offers this facility, and once again, it’s really simple and easy. People who think they have become a victim of fraud should notify the police, contact their bank, and also check their credit report.

The boss of one of Britain's leading challenger banks has called for further measures to make current account switching simpler, amid concerns that momentum is being lost in the battle for market share.